Samsung’s 2022Q3 financial report fell short of expectations

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Samsung announced that its board of directors voted today to approve the appointment of Jay Y. Lee as chairman of Samsung Electronics. After ten years since he became the vice chairman in 2012, Jay Y. Lee was finally promoted to the chairmanship, and Samsung will enter the “Jay Y. Lee era”.

Samsung semiconductor R&D center

It was not easy after Jay Y. Lee took office. It coincided with the cold winter of the global semiconductor industry. The financial report showed that Samsung was affected by the sluggish demand for memory chips and electronic consumer markets. Revenue in the third quarter of 2022 fell short of expectations, marking its first profit decline in three years. Samsung’s third-quarter 2022 financial report shows that its revenue was 76.78 trillion won, a year-on-year increase of 3.8%, a record high; operating profit was 10.85 trillion won, down 31.4% year-on-year and 23% month-on-month; net profit was 9.39 trillion won, down 23.6% year-on-year.

Among them, the revenue of the semiconductor division was 23 trillion won, down 14% year-on-year, which was also lower than expected. Average prices for DRAM and NAND chips have fallen by about 20% over the past quarter. Although Samsung has increased investment in the semiconductor business in the past two years, due to the severe macroeconomic situation, Samsung, which is extremely cautious in investment, may also consider reducing production or reducing capital expenditure.
The market environment and financial reports are only one aspect. On the other hand, Samsung faces many internal management problems. Since the 7nm process node, Samsung has not been smooth in the development of semiconductor processes. In the past two years, no matter whether the chips produced by the 5nm or 4nm process, there have been major problems in terms of performance and yield, and a similar situation has also appeared in the development department of Exynos chips.

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